Water and wastewater group United Utilities said current trading is in line with expectations, but while full year revenues will be slightly higher than last year, operating profits will be lower due to costs including flooding incidents last December.

In an update to the market today, the Warrington-based group said turnover will improve due to an increase in sales in its non-regulated business.

Reported operating profit will be impacted by additional costs and asset impairments in relation to the “unprecedented flooding incidents” which occurred during December 2015, although the group expect these charges to be largely offset by insurance proceeds.

United Utilities also suffered costs of around £25m relating to the water quality incident last summer, which were recognised in the first half of the 2015/16 financial year.

The flooding and water quality incidents also took their toll on the group’s customer satisfaction ratings, it revealed.

Following “significant” improvements in previous years, it said today: “Overall, our service incentive mechanism (SIM) scores have improved slightly compared with last year.”

Investment in the business, including improving services for customers, this year is expected to be around £800m.